Sold! Dede Serves Up Ex-Boss

If Alfred Taubman, the former chairman of Sotheby’s on trial in a

stately lower Manhattan federal courtroom, ends up trading his elegant chalk

stripes for a prison jumpsuit, the most damaging evidence against him may turn

out to be not the documents that allegedly show how he and Sir Anthony Tennant,

the former chairman of Christie’s, fixed the high-end auction business, or even

Taubman protégé Dede Brooks’ compelling and occasionally tart testimony against

her ex-boss, but the business mogul’s daily planner.

It is rather universally acknowledged that we no longer live in a

democracy, but in a kind of enlightened plutocracy where the super-rich have

their own private transportation system, their own lobbyists, their own schools

(or at least ways to guarantee their progeny priority when it comes to

admissions at the best private schools and colleges), their own resorts, etc.

But rarely is that reality laid out in such gory detail.

Mr. Taubman’s day typically started with a haircut at his

apartment at 834 Fifth Avenue, or a manicure and pedicure, or a massage, or all

four, followed by a meeting or lunch with a Nobel laureate looking for a

handout, or with a prince or princess (not since War and Peace have so many royals trod a printed page), and then a

trip on his Gulfstream 4-the day ending in London, Paris or Palm Beach at

dinner with the likes of the Kennedys or the Dixon Boardmans.

While the merely rich (the top 1 percent) have long known that

billionaires live by a different set of rules (Mr. Taubman’s wealth has

variously been estimated at between $600 million and $1 billion), since they

see them on the podium being fêted at fund-raisers or at morning drop-off at

their children’s private schools and the like, there’s no telling how this news

will play with the jury that convenes at 9:45 each morning at Federal District

Court at 40 Centre Street.

It is decidedly not a jury of Mr. Taubman’s peers; it includes,

among others, a subway token-booth clerk, an assistant principal, an airline

maintenance employee and a postal worker. One has no doubt that these good and

conscientious citizens would be fully equipped to decide the fate of Sotheby’s

former chairman and still-largest shareholder, who made his first fortune in

shopping malls, were the charges against him something straightforward, like

first-degree murder.

However, he’s charged with a criminal undertaking rather more

arcane: colluding with Christie’s-ostensibly Sotheby’s main rival-to rig the

auction business so that other rich people couldn’t play the two companies

against each other and strike a better deal when negotiating a commission to

sell their Picassos and Chippendales. It’s not immediately apparent who or

where the victims are in this case.

The resolutely nondescript

government team, led by John J. Greene of the Justice Department’s anti-trust

division, has tried to paint the case as one of simple price-fixing. “Any

agreement to tamper with prices is illegal,” said Mr. Greene, whose drama-free

opening argument seemed designed to persuade the jury to ignore the fact that,

despite Mr. Taubman’s (count ’em) eight lawyers and a jury consultant, and the

presence of the international press corps, at heart the case might as well be

about pork bellies as multimillion-dollar Matisses and Renoirs.

It will be interesting to see whether the government’s strategy

works, and what if any relevance it has that more than a couple of the jurors

occasionally appear to be dozing.

The courtroom has been less than full on most days, only reaching

capacity for Dede Brooks’ cross-examination. Mr. Taubman’s unadorned daughter,

Gayle Kalisman, has been in attendance every day, but his wife Judy-there is

some dispute on the cocktail-party circuit about whether she once served as

Miss Israel or

merely Miss El Al-hasn’t been spotted once. Even more curious by their absence

are Manhattan’s art dealers, who

stand to benefit most by Sotheby’s and Christie’s difficulties.

Mr. Greene not only took the jury through the timeline of the

conspiracy-which allegedly began in 1993, when Mr. Taubman “got on his private

jet and hustled over to London, England, and had a private meeting with Anthony

Tennant”-but also offered them a crash course, with the help of a slide show,

in things like consignment contracts, seller’s commission rates and buyer’s

premiums.

With the exception of a single

fleeting reference to “celebrity sales-some of you may be familiar with the

Jackie Onassis sale”-there has been no attempt to enliven the proceedings by

featuring boldface buyers or sellers, or by showing the bric-a-brac at issue.

(In a separate class-action case settlement, victims will receive a bit more

than half a billion dollars from the two auction houses, of which $156 million

will come out of Mr. Taubman’s own pocket.)

After a brief interlude, it came the turn of the law firm Davis,

Polk & Wardwell to make Mr. Taubman’s case. If convicted, the businessman

faces a possible three-year jail term and a $350,000 fine.

Unsurprisingly, Mr. Taubman’s lawyers painted their client as an

“innocent man,” a falsely accused hero straight out of a Horatio Alger

story-despite his splendid three-piece suits, high-powered legal team and

Brahmin-like physical presence, someone who sprang from roots no less humble than

the jury’s own. (In court, the glow that once radiated off Mr. Taubman at

pre-sale cocktail parties at Sotheby’s has been replaced by an implacable

placidity; he resembles nothing so much as a top-of-the-line teddy bear as he

sits behind the defense table wearing earphones to improve his hearing-though

his lawyers, admirably, haven’t used deafness as a defense, at least not yet.)

“He grew up in the Depression,” Robert B. Fiske Jr., one of his

lawyers (and a former U.S. Attorney and Whitewater independent counsel), told

the jury. “His parents had very little money. He started working when he was 9

years old. He enlisted in the Air Force after Pearl Harbor.”

By the way, all the members of Mr. Taubman’s defense team, as

well as the prosecutors, sport American-flag lapel pins. It’s hard to see what

role patriotism or its absence plays in this case. However, there’s apparently

some feeling that the events of Sept. 11-on some days, the air in the courtroom

is acrid from the fires still smoldering at the World Trade Center a few blocks

away-might prejudice a jury in favor of the government.

While Mr. Fiske’s evocation of his client’s

rags-to-shopping-mall-riches trajectory and his charitable contributions was to

be expected (he described Mr. Taubman’s early appreciation of the role shopping

malls were to play in postwar American culture as a “vision”), his defense on

behalf of the real-estate mogul was somewhat less expected.

Mr. Taubman’s chief accuser is Diana D. Brooks (known from Fifth

Avenue to Sutton Place as “Dede”), his former chief deputy and a graduate of

the Miss Porter’s School and Yale, who pleaded guilty last year to conspiracy

charges and hopes to get little or no jail time by cooperating with the

government. And Mr. Fiske sought to portray her as an ambitious upstart and

liar-Mr. Taubman was her “get-out-of-jail-free card,” Mr. Fiske contended-and

the price-fixing as her brazen idea. It happened, Mr. Fiske told the jury,

after the price of Sotheby’s stock, of which she had more than 500,000 shares, plummeted

in 1994, her first year as C.E.O., when the spring sales fell $35 million short

of expectations and she was desperately searching for some way to improve her

company’s and her personal stock portfolio’s bottom line.

“This was not a good start for Mrs. Brooks,” Mr. Fiske informed

the jury sternly.

While Ms. Brooks was undoubtedly the prosecution’s most eagerly

anticipated witness (the better Park Avenue matrons have been conspiring for

weeks to organize their schedules and their nannies to attend her turn on the

witness stand), the defense spent much of the early going attempting, with

limited success, to tar and feather the government’s other key witness against

Mr. Taubman-Christopher Davidge, Christie’s former chief executive.

Mr. Davidge might have looked like a home-run ball to the

defense. After all, his former employers paid him approximately $8 million in

severance as well as a lucrative consulting deal to secure his testimony

against Sotheby’s. They needed Mr. Davidge’s notes and testimony to win

conditional amnesty from the U.S.

government, under a controversial program in which the crook who squeals first

in such a conspiracy gets off scot-free.

Sir Anthony Tennant, the former chairman of Christie’s and Mr.

Davidge’s ex-boss-with whom Mr. Taubman met on 12 occasions, according to those

incriminating daily itineraries, “Week-at-a-Glance” planners and Gulfstream

“flight analysis” logs that prosecutor Greene let linger on the big screen (Mr.

Taubman had no fewer than seven secretaries, handlers and schedulers to make

sure he showed up at the right place at the right time)-has also been charged

with conspiring to violate the anti-trust laws. However, he can’t be extradited

from England-where,

by the way, he’s denied all wrongdoing.

Much of the first full week of the trial was consumed with Scott

W. Muller, another member of Mr. Taubman’s legal team, hammering away at Mr.

Davidge’s credibility. The problem with this strategy is that it’s most

effective when the object of your derision is trying to save face. However, Mr.

Davidge-who looks like the amiable villain in a James Bond movie, with his

razor-sharp features and close-cropped beard-admits he lied when he repeatedly

told Christie’s lawyers that no collusion existed between his company and Sotheby’s.

According to the charges, the collusion-which included creating

non-negotiable commission rates, sharing “grandfather lists” of preferred

clients, and agreeing not to badmouth each other’s firms or poach their

employees-was initiated by Mr. Taubman but readily embraced by Sir Anthony, who

believed that good relations with one’s rivals “took out a level of competition

which was unnecessary,” Mr. Davidge testified. The two men left it to Ms.

Brooks and Mr. Davidge to work out the details in a series of meetings,

including one in Ms. Brooks’ Lexus (if Mr. Davidge recalls the car’s make

correctly) at J.F.K. airport.

While Christie’s former

C.E.O., who now lives in India with his severance package and a young wife

considered to be a great beauty, seemed to derive sadistic pleasure from

forcing Mr. Muller to show him a particular document or help him refresh his

memory about the most trivial things he did or said, he eventually, usually,

got around to admitting that regrettably, yes, he did lie.

Mr. Davidge’s biography is at least as compelling as Mr.

Taubman’s. He dropped out of school at 16, supported himself by buying and

selling at London street markets (perfect training for running a major

intentional auction house, wags in the peanut gallery have pointed out), and

then got a job at Christie’s where, over the next 34 years, he rose

methodically through that gilded world by dint of hard work and street

smarts-never more in evidence than in his understanding of the care and

grooming of the British aristocracy, for whom his respect seems meager at best.

Some of the trial’s lighter moments have come at their expense

(and Mr. Muller’s), as Mr. Davidge-who never found acceptance among the

monarchy’s upper classes, nor apparently lost much sleep over it-gently

lectured the lawyer on the subtleties of English class and caste. During one

such exchange, Mr. Taubman’s lawyer expressed skepticism over Mr. Davidge’s

claim that he wasn’t particularly familiar with Lord Camoys, who became deputy

chairman of Sotheby’s board of directors.

Mr. Muller, sounding impressed, noted that Camoys’ credentials

included serving as Lord Chamberlain to the Queen of England, the male

equivalent of a lady-in-waiting.

“That wouldn’t make him well-known,” Mr. Davidge noted archly.

“An American lawyer can’t rattle a man like Davidge,” observed

Nicholas Wapshott, the Times of London ‘s

man at the trial. “Davidge is like Jeeves. He’s seen absolutely everything.”

Dede Brooks cut a far different, almost tragic figure as she took

the witness stand at the start of Week 3. “She looks terrible,” sighed a woman

in the audience who knew Dede back when she was the most powerful woman in the

art world.

Ms. Brooks testified that she’s currently tutoring

underprivileged children and working on a project to turn unused convents into

boarding schools for inner-city children-a laudable venture, but one that

undoubtedly lacks the thrills of being the toast of New York society and a

business-magazine cover girl.

Sotheby’s former C.E.O. portrayed Alfred Taubman as anything but

the detached philanthropist his own lawyers have tried to paint him. She said

she had to ask him, at the behest of her children, to stop bugging her at home

with phone calls on weekend mornings; she was already putting in 80-hour weeks

at the office. And he called not just to discuss affairs of state, but also

things as picky as whether a piece of jewelry ought to be reshot for a catalog,

she said.

At another point, she testified that he broached the possibility

of fixing not just commission rates with Christie’s, but also estimates on

works of art. “I told him there was no way we could do that,” Ms. Brooks told

the jury, describing it as “impractical.” “Our art specialists were in the

business to do a job. There was no way I could start telling them what

estimates to put on objects.”

Hovering over the trial is the question of why Dede Brooks went

along with the scheme and destroyed her reputation. At her peak, she was worth

between $35 million and $40 million in Sotheby’s stock options, she reported,

and sat on the boards of Yale, Morgan Stanley, Deerfield

Academy and Delaware’s

Winterthur Museum.

The prosecutor for this phase of the trial, Philip Cody, gave Ms.

Brooks ample opportunity to explain her motives and rehabilitate her image, but

she didn’t seize it. At one point, he asked why it had taken several weeks for

her and Mr. Davidge to meet for the first time in London

and begin to work out the nuts and bolts of the collusion that Mr. Taubman and

Sir Anthony had allegedly agreed to in principal.

“I have thought a lot about that in the last 22 months,” Ms.

Brooks told the hushed courtroom, before reaching for the most prosaic of

explanations: Newly appointed as the company’s C.E.O., she wasn’t as

well-informed about the organization’s European operations as Mr. Davidge was

about Christie’s, and first needed to get up to speed.

She added that while she was nervous about the meeting, she-in

apparent contradiction-found nothing wrong about attending it at the time,

since she believed Sotheby’s provided its clients and shareholders value and,

before the alleged collusion, “we were killed by what we were having to give

away”-referring to concessions such as 0 percent sellers commissions-as the

competition with Christie’s became increasingly cutthroat.

For a moment, it was almost possible to sympathize with her-the

new gal in the job just wanting to please the boss and help the bottom line.

While the witness threw some morsels Mr. Taubman’s way-describing

her former mentor as “an amazing man, incredibly passionate about

Sotheby’s”-she wasn’t above sticking a knife in his back, or rather his

well-upholstered belly, and undoubtedly ingratiating herself with the Feds. She

recalled a dramatic meeting with Mr. Taubman-one guaranteed to make it into a

movie about the case in the works at HBO. (Sigourney Weaver, another Yalie, is

considering playing Ms. Brooks and has been spotted in the courtroom boning up

for the role.)

The meeting occurred as the government was lowering the boom on

Sotheby’s and Ms. Brooks was instructed not to meet Mr. Taubman outside the

presence of a lawyer. Alone together momentarily outside her office, he told

her “Just don’t act like a girl,” she testified. At the end of the meeting, she

added, he held up a copy of the Financial

Times with a story about the unraveling conspiracy and her picture on the

front page and said, “You’ll look good in stripes.”

Mr. Fiske’s cross-examination of Ms. Brooks may have seemed only

to raise her stature in the eyes of the jury as he pursued a desultory line of

questioning that seemed aimed at persuading them that the price-fixing scheme

was Ms. Brooks’ idea.  She forcefully and

succinctly challenged his interpretation of events and his selective reading of

her grand-jury testimony. To some art-world types in the courtroom, it was a

flashback to the old Dede they knew and respected, if not necessarily

loved. 

The only points Mr. Fiske seemed to score came at the end of his

cross-examination, when he played a video of a 1997 appearance Ms. Brooks made

on Wall Street Week in which she

stated, “Our integrity is all we have”-bringing her briefly to tears.

Why people such as Mr. Taubman and Ms. Brooks, who had it all,

would risk their reputations for something as dangerous and potentially

transparent as rigging the auction market may never be suitably answered-at

least not in court. The most logical explanation, of course, is that they

didn’t think they’d get caught.

Mr. Fiske, who was delegated to cross-examine Ms. Brooks-perhaps

because he seems as equally high WASP as she-tried to address that mystery in

his opening argument, spinning the question to his advantage and using it as an

argument for Alfred Taubman’s innocence.

“At 70 years old, he was secure,” Mr. Fiske told the jury. “He

had it all. For years, he’d had both fame and fortune. He had a net worth of

over $700 million.”

The jury could agree with Mr. Taubman’s lawyers that this friend

of princes would have no reason to do anything as dumb and self-destructive as

fixing prices with his chief rival. Then again, reviewing those itineraries,

they may decide that it was precisely the lifestyle they reveal-the jets, the

apartments, the friends who, like him, seemed to inhabit an almost magical

realm-that persuaded him that he was above the law.

Sold! Dede Serves Up Ex-Boss